PROJECT SUMMARY Behavioral states such as sleep and wake profound affect the patterns of activity within neocortical circuits, but the function of these state changes on experience-dependent development and plasticity remain controversial. An influential theory, the synaptic homeostasis hypothesis (or SHY), proposes that sleep serves to homeostatically ?renormalize? synaptic strengths/firing rates that were perturbed by experience-dependent changes in the waking state. My lab studies the homeostatic mechanisms that stabilize firing rates within visual cortical microcircuits, and can track this process in primary visual cortex (V1) of freely behaving animals. We have shown that perturbing firing rates through monocular visual deprivation (MD) in monocular V1 initially suppresses firing (1-2d MD), but that firing rates then rebound to control levels over a 2 d period (MD3-4) despite continued MD. This restoration of firing is accomplished in part through synaptic scaling up of excitatory synapses onto pyramidal neurons within V1. We can follow this process of firing rate homeostasis using chronic recordings in freely behaving animals that are cycling between short bouts of sleep and wake, allowing us to directly determine whether the homeostatic restoration of firing occurs during sleep or during wake. Surprisingly, we found that upward firing rate homeostasis (upward FRH) occurs gradually during each bout of active wake, but is suppressed during quite wake and sleep (Hengen et al., 2016). Thus, in striking contrast to the SHY hypothesis, upward homeostatic plasticity happens during wake, not sleep. Here we propose to extend these findings to downward homeostatic plasticity, to explore the features of waking/sleeping states that enable/suppress homeostatic plasticity, and to determine whether opposing forms of plasticity (such as Hebbian LTP and synaptic downscaling) are segregated into distinct behavioral states. These experiments promise to illuminate a fundamental feature of cortical physiology, and to shed light on the function of sleeping and waking brain states in coordinating synaptic plasticity induction within neocortical circuits.